Non-legislation /
Market driven
requirements
Engineering
August 2014
Non-legislation / market driven requirements
What are market driven requirements?
Social requirements
Product safety
Environmental requirements
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Centre for the Promotion of Imports from developing
countries
Non-legislation / market driven requirements
What are market driven requirements?
Social requirements
Product safety
Environmental requirements
3
Centre for the Promotion of Imports from developing
countries
Legislation
Consumer / User
Health and Safety
Environment
CE Marking/HACCP
Social / Fair
Trade labels
ISO 9000 series
Certificate
Quality
E.g. Packaging, WEEE,
RoHS, Cadmium
SA 8000 / OHSAS
Certificate
EN / IS0
norms
Codes of
conduct
ECO Labels
Social accountability
IS0 14001
Certificate
Environment
Market driven
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Centre for the Promotion of Imports from developing
countries
Market access requirements
(EU) Legislation:
(EU) Buyer Requirements:
Consumer Health
& Safety
Social issues
Environmental
Issues Product /
packaging
Environmental issues
Manufacturing
Direct impact
in the EU
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Impact abroad e.g.
exporting country
Centre for the Promotion of Imports from developing
countries
Company values
Governments
Legislative compliance:
- Consumer health and safety
- Environment
NGOs
Public pressure:
- Replace dangerous chemicals
- Brands: responsibility for
supply chain
Clients
- Products according to specs
- High quality assurance
Consumers
Company
policy
Black Box
Purchase
requirements:
-Social
-Product safety
-Environmental
-Quality
Consumer products
Expect:
- Safe products
- Good circumstances
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Centre for the Promotion of Imports from developing
countries
Why comply?
Minimum requirements
for becoming a supplier
Preferred supplier & Niche
markets
Preferred supplier
main stream markets
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Centre for the Promotion of Imports from developing
countries
Non legislative requirements
Most non legislative requirements deal with:
•
Quality
•
Social issues
•
Product safety
•
Environmental issues
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Product / market / buyer specific
Centre for the Promotion of Imports from developing
countries
Non legislative requirements
These requirements are included in:
•
Sector Codes
•
Company Codes of Conduct
•
Supplier Declarations
•
Management systems
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Centre for the Promotion of Imports from developing
countries
Examples
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The Volvo Group
prefers to work
with component
suppliers,
consultants,
distributors and
other business
partners that
share the
principles
expressed in this
Code of
Conduct.
Centre for the Promotion of Imports from developing
countries
Examples
Dutch sector association for the Metal sector
13000 SMEs in the Netherlands
A CSR monitor to assist their members in integrating CSR in
their policies and operations
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Centre for the Promotion of Imports from developing
countries
Examples
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Centre for the Promotion of Imports from developing
countries
Example of non-legislative requirements
NSK
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Centre for the Promotion of Imports from developing
countries
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Centre for the Promotion of Imports from developing
countries
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Centre for the Promotion of Imports from developing
countries
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Centre for the Promotion of Imports from developing
countries
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Centre for the Promotion of Imports from developing
countries
References, Management and performance
ISO 26000
ILO
OECD
GRI
ISO 26000
ISO 14001
OHSAS 18001
GRI
SA 8000
labels
References
Management
Performance
What is
CSR?
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What to do and how?
Continuous
improvement
Disclosure and
compliance
Centre for the Promotion of Imports from developing
countries | September 2010
CSR References
Reference
ISO 26000
The international guideline for CSR
ILO
The basis for most labour related CSR initiatives
OECD Guidelines
Expectations of governments with regard to the
behaviour of multinational enterprises
Global Compact
An international CSR initiative which companies can
join
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Centre for the Promotion of Imports from developing
countries
ISO 26000 – Guidance on Social responsibility
Developed by developed and developing countries
To
•
•
•
be used as an international reference on SR
What is (C)SR?
What do the issues mean?
What is expected from companies?
To be used as a guidance document
•
How to identify stakeholders?
•
How to implement CSR in the organisation?
Not for certification (self declarations)
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Centre for the Promotion of Imports from developing
countries
Companies use
ISO26000 to develop
their CSR policy
Including requirements
for suppliers
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Centre for the Promotion of Imports from developing
countries
Social requirements
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Centre for the Promotion of Imports from developing
countries
Social requirements
Social issues have become increasingly important in international trade
Negative publicity on labour conditions may have an impact on your
clients’ reputation and sales → your sales
It is not just about buyers’ requirements!
Improved labour conditions will positively impact productivity,
recrutement and retention of high quality personel
It is a part of a responsible / decent business
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Centre for the Promotion of Imports from developing
countries
Social requirements - ILO
ILO Conventions
•
UN organization dealing with aspects of work
•
International labour standards
•
Governments are obliged to implement ratified Conventions in
their own national policies.
•
Many social requirements on labour conditions by the private
sector are based on the ILO Conventions
Which of the (185) ILO Conventions are being used
by the private sector as market access requirements?
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Centre for the Promotion of Imports from developing
countries
Social issues – 8 core ILO Conventions
1.
Right to union membership and to negotiate
2.
Non-discrimination
3.
Forced labour
4.
Minimum age
5.
Working hours
6.
Equal remuneration
7.
Minimum wages
8.
Occupational Health and Safety
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Centre for the Promotion of Imports from developing
countries
Social issues – example of BSCI
Business Social Compliance Initiative
•
Focus on social issues
+
Compliance with environmental legislation
•
Based on ILO
•
One auditing system for the European retail and brands based on a
common code ; no certificate
•
Suppliers that are audited will be included in the CBI database
•
BSCI members can use this database
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Centre for the Promotion of Imports from developing
countries
BSCI
Over 1000 members: retail, brands and manufacturers
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Centre for the Promotion of Imports from developing
countries
BSCI
Use the code as a benchmark
for your organisation
Also look at other codes of
conduct!
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Centre for the Promotion of Imports from developing
countries
Social issues – Conflict minerals
Due
diligence
and
traceability
Partners:
Nokia,
Blackberry,
Philips, HP,
Motorola,
Tata steel,
etc.
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Centre for the Promotion of Imports from developing
countries
Managing social issues: OHSAS 18001
Occupational Health and safety Assessment Series
• A framework for managing occupational health and safety
responsibilities
• Tools to identify elements of your business that have an impact on
health and safety
• Designed for all sectors
• Non-accredited certificates
• Implementation is structured along the lines of ISO 14000
• It is a tool to improve on OHS and show commitment
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Centre for the Promotion of Imports from developing
countries
Performance on social issue: SA 8000
SA8000
• International standard for working conditions
• The first auditable social standard / independent
• Standards: what is considered social accountability?
&
Requirements for a management system: implementation of the
standards in business policy
• Certification by means of independent verification
• Applicable to all industries
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Centre for the Promotion of Imports from developing
countries
SA 8000
Standards based on ILO and other human rights conventions
9 core areas:
1. child labour
2. forced and compulsory labour
3. health and safety
4. free association and collective bargaining
5. discrimination
6. disciplinary pratices
7. working hours
8. remuneration (compensation)
9. management systems
(incl. supplier control and stakeholder engagement)
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Centre for the Promotion of Imports from developing
countries
Product safety requirements
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Centre for the Promotion of Imports from developing
countries
Product safety
Companies tend to require more than what is legally obligatory:
risk management
•
•
•
Longer lists of hazardous substances
More stringent requirements
Pro active on legislation (e.g. SVHC in REACH)
Codes of Conduct
Substances restrictions
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Centre for the Promotion of Imports from developing
countries
Product safety - example
“Policies can be developed
that may go beyond
legislative compliance
based on scientific evidence
and stakeholder
consultation”
“Each supplier is required
to ensure product
compliance with this list”
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Centre for the Promotion of Imports from developing
countries
Environmental requirements
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Centre for the Promotion of Imports from developing
countries
Environmental requirements
Focus of buyers on products
•
Design for recycling / Reuse
•
Use of hazardous substances (also as a result of RoHS, REACH, CE)
•
Biobased / circular economy / Cradle to cradle
•
Packaging
•
Transport
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Centre for the Promotion of Imports from developing
countries
Environmental requirements
Focus of buyers on processes
•
Emissions of hazardous substances
•
Energy use
•
Water use
•
Impact on biodiversity
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ISO26000:
• Prevention of pollution
• Sustainable resource use
• Climate change mitigation and adaption
• Protection of the environment,
biodiversity and restoration of natural
habitats
Centre for the Promotion of Imports from developing
countries
Environmental issues - example
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Centre for the Promotion of Imports from developing
countries
Environmental issues – example Volvo
• Suppliers also responsible for subsuppliers
• Comply with applicable legislation
• Have knowledge of Volvo’s policy
• ISO 14001 or EMAS
• Able to report on environmental work
• Maintain an open dialogue with Volvo
for improvements
• Environmental data must be available
on request
• Chemicals and materials involved must
meet Volvo standard requirements
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• Comply with REACH
• Minimize impact of packing materials
• Handle excess and rejected materials
with minimal impact
• Consider use of
recycled/recyclable materials
• Supply specified chemical and material
content on request according to the
International Material Data System
Centre for the Promotion of Imports from developing
countries
Environmental issues - Philips
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Centre for the Promotion of Imports from developing
countries
Environmental issues - Management
ISO 14001
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Centre for the Promotion of Imports from developing
countries
ISO 14001
Why ISO 14001?
• Improved perception of the key environmental issues by employees and a
better (greener) public image of the organization
• An increase in the efficiency and use of energy and raw materials
• Improved ability to meet compliance with environmental regulations
• Dependence on a system rather than just the experience and capabilities of
an individual to manage the environmental function of an organization.
But: No guarantee for good environmental performance!
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Centre for the Promotion of Imports from developing
countries
ISO 14001
Market Impact
•
The standard is widely used in many countries; also without
actual certification
•
ISO 14001 required / preferred by some buyers
•
Integration in Public green procurement (certification not
required)
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Centre for the Promotion of Imports from developing
countries
Showing performance: environmental labels
• Communication tool: Business to business or consumer
• Mainly niche markets, increasingly mainstream in food
• Mostly on products, not on components
Some environmental product labels in the EU
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Centre for the Promotion of Imports from developing
countries
Environmental labels
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Centre for the Promotion of Imports from developing
countries
Labels… How to use them?
• To use to identify key issues & best in class
• To benchmark your products / processes
• To show compliance with specific social & environmental
requirements in the supply chain (B2B)
• To show that you perform better than the competition
• Some labels required by legislation (like CE)
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Centre for the Promotion of Imports from developing
countries
How to keep track?
Check for your products and
potential export countries!
Use the CBI website
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Centre for the Promotion of Imports from developing
countries
So what to do?
1. Select initiatives relevant to your product or sector
2.
Use self assesments & audits to benchmark your performance
3.
Assess CSR Position and ambition
4.
Use the tools to improve, comply and market
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Centre for the Promotion of Imports from developing
countries
And…..
To prevent yourself from running from one buyer
requirement to another…
develop your own Code of Conduct!
Make sure your workers understand why CSR is important
and integrate it in business operations
You are not just doing it for the market!
Efficiency, productivity, innovation
&
You want to run a responsible business
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Centre for the Promotion of Imports from developing
countries
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Centre for the Promotion of Imports from developing
countries